How To Apply For Social Security Using The Protective Filing Statement

When planning for your Social Security benefit, there is an additional tactic that you may never have heard of: the Protective Filing Statement.  This statement is a way to apply for benefits without actually applying.

Huh?

Here's How It Works

At any time after you reach age 62, you can file the Protective Filing Statement (PFS) which will “protect” the date of acceptance as your application date, whenever you choose to apply in the future.  And when you do apply, the PFS date will be considered your filing date – and you’ll get retroactive benefits back to that date.

After the PFS is filed, the SSA will issue a notice indicating that you must file within six months.  This doesn’t mean that you have to file within six months, it just means that, in order to retroactively file as of your protected date, your actual application must have been filed no later than six months after the protected date.

How does this work in practice?  Let say that you reach age 62 in February this year.  You’re actually eligible for benefits in March, since you weren’t 62 for the entire month of February… so you file a PFS in March.  You’re not ready to collect benefits, but you want to protect your date.  Then in July your company “reorganizes” (we all know that really just means layoffs).  Instead of seeking other work, you decide to just go ahead and retire.  When you file your application for Social Security benefits in August, your actual filing date can be retroactive to March, since you filed a PFS.

If your income for the year was low enough, you might go ahead and take the retroactive benefits – but the key here is that without the PFS you would forego those benefits altogether.  It’s for this purpose that it makes sense to file a PFS from time to time if you’re delaying receipt of benefits sometime after age 62.

How To Do It

There’s nothing magical about the PFS – it’s simply a statement you’ve made to the SSA indicating that you’re intending to file at some point in the future.  You don’t have to set a date, you just need to indicate that you’re intending to file.  Here are the requirements:

  • Must be in writing
  • Must indicate an intention to claim in the future
  • Must be signed by the applicant
  • Must be submitted to your local district office

And that’s it.  A few words of caution are in order:  Keep a date-stamped copy of your PFS.  If you hand-deliver the statement (recommended) to the district office, ask the representative to photocopy the statement and date-stamp your copy.  Occasionally these get lost, and without a copy of your statement, it will be impossible to prove that you submitted it.

If mailing the statement, make a copy beforehand, and then send the statement by registered or certified mail.  This way you’ll have evidence of delivery.

It’s also important to note the six month limit for the PFS.  After six months has passed, the PFS is no longer in effect, and if you apply at that stage, unless you’ve file a subsequent PFS, the date of your application is your filing date, with no retroactivity.

IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).

 

About the author

Jim Blankenship, CFP®, EA

Jim Blankenship is the founder and principal of Blankenship Financial Planning, Ltd., a financial planning firm providing hourly, as-needed financial planning and advice. A financial services professional for over 25 years, Jim is a CFP professional and has earned the Enrolled Agent designation, a designation that qualifies him as enrolled to practice before the IRS. Jim is also a NAPFA-registered financial advisor, which designates him as a Fee-Only Financial Advisor.

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